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companylogoFine Organic Industries Ltd

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BSE Code : 541557 | NSE Symbol : FINEORG | ISIN : INE686Y01026 | Industry : Chemicals |


Chairman's Speech

LEADERSHIP MESSAGE

Insights from Our Chairman

Our focus on adding new facilities, incorporating new product lines, and implementing process improvements and technology upgrades further strengthens v our competitive position and supports future growth initiatives.

Dear Shareholders,

It gives me immense pleasure to address all of you and provide a review of the year's performance and our progress.

Embracing a Holistic Approach: Culture, Nature, Future

The theme for this year, ‘Culture, Nature, Future,' encapsulates the Company's holistic approach to growth and sustainability. We prioritise fostering a culture of collaboration, respect, and

continuous learning, ensuring each team member feels valued and inspired. Succession planning is central to our focus on driving growth, with leadership transitions marking crucial milestones. Amidst this trajectory, we remain dedicated to exploring new ideas and expanding our business. As we focus on driving the Company's growth in the coming years, succession planning takes centre stage to ensure seamless transitions in leadership. Passing the baton of the Company's leadership to a new team marks a crucial step

in our journey. ‘Nature' highlights our commitment to environmental stewardship, minimising our ecological footprint through sustainable practices. ‘Future' reflects our forward-looking approach to innovation and impact, embracing emerging trends and technologies to shape a brighter future for all stakeholders.

Global Resilience: Navigating Macroeconomic Challenges

The global economy has shown remarkable resilience despite facing several challenges, including the Israel-Hamas war and the Red Sea Crisis. Despite these challenges, the global economy remained stable with a growth rate of 3.2% in CY 2023. It is forecasted to remain steady through CY 2024 and CY 2025 according to IMF. In 2023-24, India's economy grew impressively at 8.2% according to PIB, marking the third consecutive year of surpassing the 7% mark. This growth is attributed to the Indian Government's efforts to rejuvenate both the physical and digital infrastructure to strengthen connectivity, boost the manufacturing sector's competitiveness, and promote exports.

2023-24 Performance: Thriving Amid Adversity

Despite challenges like geopolitical tensions, fluctuating freight charges, and container availability issues, the Company has maintained its upward trajectory. Leveraging our global presence, we have adeptly responded to evolving customer demands while keeping capacities engaged throughout the year.

Despite a challenging year, we remain steadfast in our commitment to growth

and resilience. Our revenue from operations stood at ' 2,123 crores and EBITDA stood at ' 534 crores, we maintained a strong EBITDA margin of 25.2%. Our Profit After Tax (PAT) stood at ' 411.9 crores, while our Return on Capital Employed and Return on Net Worth stood at 24.74% and 21.44% respectively. These results highlight our ability to adapt and sustain profitability in tough market conditions.

Moreover, our focus on adding new facilities, incorporating new product lines, and implementing process improvements and technology upgrades further strengthens our competitive position and supports future growth initiatives.

Valuing Our People: Our Greatest Asset

Our employees are not just stakeholders but our most valuable assets. Despite facing tough and challenging conditions, they have consistently contributed significantly to our progress. We remain committed to providing them with comprehensive health and insurance benefits and other amenities. Moreover, we prioritise job security to instill confidence among our workforce. Recognising our responsibility towards these foundational aspects, we continuously strive to strengthen our reputation as an employer of choice, dedicated to the well-being of our employees.

Championing Sustainability: Our Commitment to ESG

Environmental, Social, and Governance (ESG) practices are deeply ingrained in our corporate culture and operational framework. We have implemented various initiatives to reduce our carbon

footprint and advance sustainability across our operations. By prioritising sustainability, we have minimised our environmental impact and operational efficiency improvements.

While sustainability is integral to our business ethos, we indirectly support our clients in achieving their ESG goals with solutions that align with their sustainability initiatives. This approach benefits the environment and enhances our overall value to our clients, fostering long-term partnerships based on shared environmental values.

Closing Remarks: A Vision for the Future

As we reflect on our journey and the achievements we have made together, I extend my deepest gratitude to our dedicated team, whose commitment and hard work have driven our success. I also want to express appreciation to our valued stakeholders for their continued support and trust in our vision. Looking ahead, we remain resolute in our pursuit of excellence, innovation, and sustainable growth. Together, let's embrace the opportunities that lie ahead and continue to make a positive impact in our industry and beyond. Thank you for being a part of our journey.

Best Wishes
Mukesh Shah
Chairman

From the MD's Desk

We are poised to not only meet but exceed the expectations of our stakeholders while contributing to a more sustainable future through innovation and responsible practices.

Dear Shareholders,

It is with great pleasure and a sense of responsibility that I address you all for the first time as the Managing Director. As we look back on the past year and chart our course for the future, I extend my sincere gratitude for your continued support and commitment.

Specialty Chemical Industry:

A Growing Force

According to Grand View Research, the global specialty chemicals

market, valued at US$ 641.5 billion in 2023, is anticipated to advance at a CAGR of 5.2% from 2024 to 2030. This impressive growth is largely driven by the increasing demand for pharmaceuticals, food and feed additives, and flavours and fragrances, among other sectors. This positive trend reflects the critical role that specialty chemicals play in various industries and underscores the exciting opportunities that lie ahead for our business.

The Indian specialty chemicals industry

has experienced significant growth in recent years, solidifying its position as a key player in the country's chemicals and petrochemicals market. Record levels of investment in capital expenditure and strong revenues emphasise this growth, fuelled by robust demand from global clients seeking alternatives to China and a rise in domestic consumption. India's attractiveness as a manufacturing hub is further strengthened by factors such as low-cost operations, skilled labour,

and favourable government policies. With investments in R&D, operational scaling, and efficiency measures, India is poised to expand its global market share. It is set to emerge as a compelling alternative hub for specialty chemical manufacturing, attracting numerous global manufacturers looking to diversify their production capacities.

Specialty Performance Additives: Driving Sustainable Solutions

At Fine Organics, we remain committed to the specialty performance additives business, recognising the tremendous potential of oleochemistry. We are determined to explore new avenues and expand our product range, using raw materials plant sources and highly automated facilities that ensure quality consistency at global benchmark levels.

Our goal is to continue expanding within this sector, leveraging our technical expertise and commercial experience. To strengthen our global presence, we actively explore acquisitions and new opportunities. We are confident that these strategic initiatives will enable us to reach greater heights and deliver sustained value to our shareholders.

Strategic Expansion: Enhancing Global Footprint

We have incorporated a wholly owned subsidiary of the Company in Maharashtra, named Fine Organic Industries (SEZ) Private Limited. This subsidiary is in process of acquiring a strategic parcel of land at the JNPA in Mumbai for a greenfield expansion project. This expansion marks a pivotal moment for our future growth, as it will enable us to enhance our global footprint by exporting our products manufactured at this new facility.

This expansion seamlessly integrates with our overarching international strategy, epitomised by our joint venture, Fine Organic Industries (Thailand) Co. Limited which focusses on manufacturing, exporting, and distributing specialty additives.

R&D Facility: Driving Innovation and Efficiency

The recent relocation of our R&D facility from Mahape to Dombivli in Maharashtra marks a pivotal move aimed at bolstering our operational efficiency and advancing our capabilities. Equipped with cutting- edge technology, our new R&D hub is spearheaded by seasoned scientists and researchers, underscoring our commitment to excellence in innovation and developing cutting-edge solutions.

Our focus is on exploring new end- use opportunities with oleochemical- derived green additives. It plays a crucial role in developing a diverse range of additives across industries including food emulsifiers, cosmetics, coatings, polymers, rubbers, and animal feed nutrition, among others. By leveraging our robust R&D infrastructure, we are actively engaged in rigorous trials to introduce novel products that meet the dynamic demands of our customers globally.

This strategic shift underscores our dedication to sustainability and pioneering solutions, reinforcing our position as an industry leader. We are poised to not only meet but exceed the expectations of our stakeholders while contributing to a more sustainable future through innovation and responsible practices.

Recognitions: Celebrating Excellence

Fine Organics, a leading player in the specialty chemicals industry, has been honoured with the prestigious recognition of being named Forbes Best Under 200. This accolade highlights the Company's outstanding performance and excellence within the specialty chemical sector. We have demonstrated our ability to compete and excel alongside other notable businesses, further solidifying our reputation as a top performer in the industry.

Closing Note: A Promise for the Future

As I draw this letter to a close, I sincerely thank each of you for your continued support and confidence in our collective vision. It's been an honour to address you for the first time as Managing Director, and I am truly humbled by the opportunity to lead the Company forward.

As we embark on this journey together, I am inspired by the passion and dedication that permeates every facet of the Company. With your continued partnership and commitment, I am confident that we will navigate any challenges and seize countless opportunities on the horizon.

I am excited about the road ahead and the incredible possibilities that await us. Let us remain strong in our pursuit of excellence, innovation, and sustainable growth, always mindful of our responsibility to our stakeholders and the communities we serve.

Best Wishes
Jayen Shah
Managing Director

   

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